Commonwealth Edison v. Pollution Control Bd.

PETITION for review of order of Pollution Control Board.
MR. PRESIDING JUSTICE MCNAMARA DELIVERED THE OPINION OF THE COURT:

Rehearing denied January 23, 1975.

In 1971, the Federal Environmental Protection Agency, acting under the Clean Air Act amendments of 1970 (42 U.S.C. § 1857 et seq. (1970), amending 81 Stat. 485 (1967)), adopted new primary and secondary ambient-air-quality standards. (42 C.F.R. § 410.1 et seq. (1971).) By its terms the States were required to devise their own implementation plans to achieve compliance with Federal standards. Accordingly, the Illinois Environmental Protection Agency (hereinafter the Agency), acting pursuant to section 4(j) of the Environmental Protection Act (hereinafter the Act) (Ill. Rev. Stat. 1971, ch. 111 1/2, par. 1004(j)), submitted proposals to the Illinois Pollution Control Board (hereinafter the Board) governing the emission rates of various pollutants into the air which it deemed necessary to achieve compliance with those Federal standards. Included in the plan were substantive rules limiting the emission rates from stationary sources for particulates and sulfur. In a consolidated proceeding, the Board held public hearings in relation to the proposed plan. Petitioner, Commonwealth Edison Company (hereinafter Commonwealth), appeared and produced testimony critical of the plan. On April 13, 1972, the Board adopted a final set of rules and regulations, and accompanied their issuance with an explanatory opinion entitled "In the Matter of Emission Standards." (# R. 71-23.) Pursuant to section 29 of the Act, Commonwealth has filed directly in this court a petition seeking review of the rules pertaining to the particulates and sulfur dioxide emission limitations. Commonwealth also challenges the validity of three other rules promulgated by the Board relating to certain procedures involving the Agency.

Commonwealth contends that Board Rules 203(g)(1) and 204(a)(1) and (c)(1)(A), relating to the limitation of the above-mentioned pollutants, are arbitrary and unreasonable as applied to it or, alternatively, were not enacted in accordance with the statutory command; that Board Rule 103(l), which empowers the Agency to require the posting of bond as a condition to the issuance of a permit under Title X of the Act, constitutes an unauthorized legislative penalty, unlawful delegation of legislative authority, and illegal usurpation of judicial powers; that Board Rule 103(e)(1), which states that the Agency has the power to conduct a hearing pursuant to a permit request, is void as an unlawful delegation of legislative authority; and that Board Rule 303, which authorizes the Agency to vary ambient-air-quality standards in particular instances, is invalid as an unauthorized redelegation of legislative authority. Before reviewing Rules 203 and 204, we elect to consider these latter three contentions.

Since the filing of briefs in this cause, section 39 of the Act has been amended to provide that a bond or other security shall not be required of the applicant by the Agency as a condition for the issuance of a permit. (Ill. Rev. Stat. 1973, ch. 111 1/2, par. 1039(a).) The enactment serves to moot Commonwealth's challenge to Board Rule 103(l).

Commonwealth next challenges the validity of Board Rule 103(e)(1). The rule is as follows:

"The Agency may conduct hearings, prior to issuing a Permit pursuant to this Chapter, to determine whether an applicant has submitted proof that the emission source or air pollution control equipment is or will be in compliance with every Rule of this Chapter."

Commonwealth argues that the rule constitutes an unlawful delegation of authority by the Board of the Agency. Commonwealth points out that the statute does not expressly authorize the Agency to conduct such a hearing, in contradistinction to section 5(d) of the Act, which expressly recites that the Board has the authority to hold a hearing in review of the Agency's denial of a permit application. Commonwealth thus maintains that the legislative intent must have been to deny the Agency the right to hold a hearing pursuant to its consideration of a permit application. The Board responds that the statute gives the Agency the implied power to hold such a hearing and presents the alternative argument that the rule is a proper and valid delegation of power.

• 1, 2 In determining an administrative agency's jurisdiction, the focus is on the agency's creator. (See Pinkerton's Nat. D. Agency v. Fidelity & Deposit Co. (7th Cir. 1943), 138 F.2d 469, cert. denied (1944), 321 U.S. 766.) An express grant of authority to the agency carries with it the clear and express grant of power to do all that is reasonably necessary to execute the power or perform the duty specifically conferred. A.F. Staley Manufacturing Co. v. Enivronmental Protection Agency (1972), 8 Ill. App.3d 1018, 290 N.E.2d 892.

The principal provision relating to the permit procedure is section 39(a). It states in pertinent part as follows:

"When the Board has by regulation required a permit for the construction, installation, or operation of any type of facility, equipment * * *, the applicant shall apply to the Agency for such permit and it shall be the duty of the Agency to issue such a permit upon proof by the applicant that the facility, equipment, * * * will not cause a violation of this Act or of regulations hereunder. The Agency shall adopt such procedures as are necessary to carry out its duties under this Section."

In addition section 4(g) imposes upon the Agency the duty to administer the permit system. According to section 40, an applicant denied a permit may petition the Board for a hearing. Affirmance by the Board will enable the applicant to petition for review directly to this court.

An examination of the Act reveals the depth of the legislature's concern to purify the environment and to take care that new facilities and equipment will not be constructed which might hinder this task. Having found that "environmental damage seriously endangers the public health and welfare" (Ill. Rev. Stat. 1971, ch. 111 1/2, par. 1002(a)(i)), and having specified its purpose to be the creation of "a unified, state-wide program * * * to restore, protect and enhance the quality of the environment" (Ill. Rev. Stat. 1971, ch. 111 1/2, par. 1002(b)), the legislature has prescribed that, when decreed by the Board, a project to be constructed which might violate the applicable statutory provisions or regulations must secure a permit from the Agency. Rather than setting forth detailed procedures which the Agency must follow in administering the permit system, the General Assembly saw fit to adopt broad language empowering the Agency to utilize "such procedures as are necessary" to carry out its statutory mandate.

The power of the Agency is an important one. In our view section 39(a) provides ample power to enable the Agency to conduct a hearing relating to a permit application when it deems it necessary to pass on the application. The Agency may determine that it would be beneficial to hear and question experts to predict the probable impact on the environment that a permit issuance would cause. It may wish to question members of the same or similar industry to accumulate specific information omitted from the application. The Agency may need a clarification or amplification of complicated facts or positions set forth by the applicant. Moreover, as mandated by section 39, subsections (a)(i) through (a)(iv) require a detailed explanation by the Agency to accompany the denial of a permit request which may necessitate the gathering of information not furnished in the application.

We recognize that the legislature saw fit to make an express grant of power to the Board to conduct a hearing upon review of the Agency's denial of a permit application. It can be inferred that the legislature wished to guarantee at least one full hearing in the permit structure and placed such a hearing at the review stage. At the same time, it can be seen that the legislature determined that the Agency should be free to adopt flexible procedures in gathering evidence and seeking advice, and thus granted that body the power found in section 39(a). While we appreciate the fact that an applicant may be forced to bear the expense of two hearings in its attempt to secure a permit, that will be the price it will have to pay for its decision to construct facilities which the expert agencies have decided possess possible adverse environmental implications.

• 3, 4 We hold that the Agency has the implied power by statute to conduct a hearing pursuant to an application for a permit. Thus, we need not consider Commonwealth's claim that Rule 103(e)(1) constitutes an unlawful delegation of authority by the Board to the Agency.

Commonwealth next challenges the validity of Board Rule 303. It contends that the rule is an unlawful delegation from the Board to the Agency of responsibilities imposed by statute directly on the Board. Commonwealth further argues that if the delegation is not per se unlawful, the failure by the Board to set forth ascertainable standards renders it invalid.

Rule 303 is as follows:

"Nondegradation

Existing ambient air quality which is better than the established ambient air quality standards at the date of their adoption will be maintained in its present high quality. Such ambient air quality shall not be lowered unless and until it is proved to the Agency that such change is justifiable as a result of necessary economic and social development and will not interfere with or become injurious to human health or welfare."

• 5, 6 The Board is empowered to adopt regulations to promote the control of air pollution (Ill. Rev. Stat. 1971, ch. 111 1/2, par. 1010(b)) and to prescribe standards for the issuance of permits by the Agency (Ill. Rev. Stat. 1971, ch. 111 1/2, par. 1010(c)). While a regulation, like a statute, enjoys the presumption of validity (Armstrong Chemcon, Inc. v. Pollution Control Board (1974), 18 Ill. App.3d 753, 310 N.E.2d 648), an administrative agency cannot extend the operation of a statute through its own rulemaking. (Mallen Co. v. Department of Finance (1939), 372 Ill. 598, 25 N.E.2d 43.) The key question in determining the validity of a rule or regulation is whether the rule or regulation was made in furtherance of the intentions of the legislature as set forth in the statute. People ex rel. Illinois Highway Transportation Co. v. Biggs (1949), 402 Ill. 401 84 N.E.2d 372.

The Board's first answer to Commonwealth's challenge is that the rule cannot be considered a delegation of authority. Rather the rule must be viewed as merely a statement of "principle" expressing a "policy" to be followed by the Agency in the latter's administration of the permit system. The Board notes page 45 of its opinion accompanying the enactment of the rules, which allegedly supports the Board's underlying position in this regard:

"Rule 303: Nondegradation, embodies the principle, already found in Illinois air quality standards (APCB Rules and Regs. Ch. 5) and in water pollution regulations (SWB-7 through SWB-15; PCB Regs. Ch. 3 Rule 208), that parts of the state now clean shall not be unnecessarily degraded. This does not forbid all new facilities, as some seem to have thought. It requires Agency consideration, in advance of issuing a construction permit, to assure that degradation not justified by need will not occur and that new facilities are not put in the wrong place."

We believe the Board's position to be without merit. The rule cannot be considered a mere expression of policy to guide the Agency's deliberations over a permit request. Section 39 clearly states that if the proof presented to the Agency pursuant to a permit application shows that the proposed construction facility will not cause a violation of the Act or the regulations made thereunder, the permit shall be issued by the Agency. To imply that the Agency shall have the discretion to deny the application where the proposed facility would meet the requirements of the Act or regulations although lower the ambient-air quality essentially authorizes the Agency to create a new ambient-air-quality standard. Since it cannot be disputed that section 5(b) clearly authorizes the Board to create such standards, the rule must be viewed as an attempt by the Board to delegate that duty to the Agency.

• 7 Consequently, we must consider the question of whether an administrative agency can validly redelegate authority imposed upon it by statute to another administrative agency through administrative rulemaking in the absence of legislative approval. It must be observed that redelegation, a transmission of authority along horizontal lines, is unrelated and possesses far greater implications than subdelegation, a vertical transmission of power with ...

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